Legal Term
co-owner buyout right of first refusal lease
Legal Definition
A contractual provision in a co-ownership or lease agreement that grants co-owners the right to purchase or lease another co-owner's interest in the property before it is offered to third parties, typically on the same terms and conditions, often triggered by a sale or lease offer.
In Plain English
When several people own or rent a property together, this rule gives the other owners or tenants the first chance to buy or take over a co-owner's share before anyone else can, helping keep control within the group.
Example in a Contract
Section 7. Right of First Refusal on Buyout or Lease. If any Co-owner receives a bona fide offer to sell or lease their undivided interest in the Property, they shall provide written notice to all other Co-owners, including the offer terms. The other Co-owners shall have thirty (30) days from receipt of notice to elect to purchase or lease such interest on identical terms. If multiple Co-owners elect, the interest shall be allocated pro rata. Failure to elect within the period waives the right, and the selling/leasing Co-owner may proceed with the third party.
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